Dodge Clinic
John Martin, the administrator at Dodge Clinic, faced with the dilemma of how to cut down cost. Dodge Clinic, with 160 physicians, is one of the main substantial physician group practices in Center City. The Dodge Clinic, by August, has seen a $1.2 million loss of total revenues of $53.6 million. Martin needs to come up with a plan after a board meeting on how to cut these cost and present it to Rockney Howard the head chairperson of the finance department. Now the question posed is how you recover from this lost, when the physicians in the Doge Clinic do not agree on a proper course of action. When looking for a theory to use to better analyze the problems facing the Dodge Clinic, Chester Barnard and his theory on Functions of the Executive, best explains the Clinics loss of revenue. Barnard stresses the importance of establishing and maintaining a system of communication, securing essential services from other members, and formulating organizational purposes and objectives. (Barnard, 1938, Functions of the Executive) When looking at the varying Physician responses on how to cut cost at the Dodge Clinic, one theme is continuously brought up, the issue of too many people, specifically managers. It is because of this large amount of managers that I believe things are being lost in translation, therefore, no system of communication is established or maintained and it is ultimately hurting the efficiency of the clinic and the overall bottom line cost. Barnard also emphasizes authority and incentives; authority is key when communication is in question. (Barnard, 1938, Functions of the Executive) Lines of communication should be as short and as direct as possible, and having five different managers handle a message before the person it is intended for receives it is not short or direct. The channels of communication should be definite, without the definite channels there is no set unity in working towards a common goal. (Barnard, 1938, Functions of the Executive)
The Dodge Clinic should have followed the Chester Bernard theory of Functions of the Executive to run an organization with such an array of specialties and varying moving parts. Two years ago when the Clinic underwent a transition from a partnership organization to a not-for-profit foundation there should have been a clear agenda laid out, covering everything from hiring measures, to overall allowed cost, to the rules of their organization. According the Management Library, Bernard says you need to meet two criteria points that are necessary for survival: effectiveness and efficiency. Barnard elaborates a number of specific concepts that he views as essential for success as an executive. One of the key concepts is that of organizational purpose which is necessary to give meaning to the rest of the organizational environment. (Rasmussen, 2003, p. 520) When reading the arguments made by the physicians at the meeting it is clear that they are not on the same page when it comes to the ideas of running a business and not all of them share the same goals. This in return left the staff members in varying areas in the clinic with different goals and having no set organizational purpose creating no unity therefore, things fell between the cracks such as the budget. In the textbook, Public Administration in the New Century, Barnard discuses the relationship between personal and organizational values, and the employees, with the “zone of indifference”, saying that employees will except a task assigned to them as long as they view the task as ligament. (Greene, 2005, p.379) Though Barnard uses this to describe tasks assigned from employers to employee, it is useful when explaining why the physicians have not run a successful clinic, they all view different tasks as legitimate or illegitimate therefore are trying to accomplish different goals.
To summarize, I will review the areas of administration that went wrong in the Dodge Clinic. There was no effective system